SR&ED For Agricultural Science

Most of the time when SR&ED tax credit is mentioned, many minds simply think of technological companies or individuals in lab coats but in fact, SR&ED encompasses much more than this. According to the Guide to Form T661, one of the industries that qualifies for the credit is agricultural science, including animal and dairy science.

In Canada, most farming operations are standard business-as-usual, which does not directly qualify for the SR&ED credit. However, the good news is that businesses of any size can qualify and lab research is not a requirement. Companies just need to be conducting work to create or improve a product or process. For instance, processes that would be eligible for the credit include:

  • Reducing pollution and waste
  • Finding a new way to increase the yield of food
  • Devising a new way to store food
  • Developing new or customizable farm equipment
  • Improving pest control processes
  • Improving breeding processes
  • Increasing the preservation of feed to increase shelf life

Agricultural industries that qualify include seafood producers, poultry producers, dairy and egg producers, fruit producers, meat processing and pet and animal food manufacturers.

All claims must ensure that:

  • The project contains some degree of uncertainty;
  • There is evidence to support the submission; and
  • There were systematic steps to generate new information or knowledge.

Sectors like farming are often overlooked when it comes to the SR&ED tax credits. Swanson Reed R&D Tax Advisors can advise you accordingly on how to qualify and claim the SR&ED tax credit.

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